If you’re a small business owner or a freelancer, you’ve probably heard of QuickBooks. It’s one of the most popular accounting software tools out there, helping businesses manage their finances, track expenses, and process payments. But when it comes to accepting credit card payments through QuickBooks, one question always pops up: How much does QuickBooks charge for credit card payments?
In this blog, we’ll break down everything you need to know about QuickBooks’ credit card processing fees. We’ll cover the costs, how they compare to other payment processors, and answer some common questions to help you make an informed decision. Let’s dive in.
Table of Contents
Why Use QuickBooks for Credit Card Payments?
Before we get into the fees, let’s talk about why you might want to use QuickBooks for credit card payments in the first place. Here are a few reasons:
- Seamless Integration: QuickBooks syncs your payments directly with your accounting records, saving you time on manual data entry.
- Professional Invoicing: You can send polished invoices to clients with a “Pay Now” button, making it easy for them to pay you.
- Mobile Payments: QuickBooks allows you to accept payments on the go using their mobile app.
- Tracking and Reporting: All your transactions are automatically tracked, making it easier to manage cash flow and prepare for tax season.
Now that you know why QuickBooks is a great option, let’s talk about the costs.
QuickBooks Credit Card Processing Fees: The Basics
QuickBooks charges a fee for every credit card transaction you process. These fees are competitive with other payment processors like PayPal or Square, but they can vary depending on the type of transaction. Here’s a breakdown of the standard fees:
| Transaction Type | Fee |
|---|---|
| Invoiced Payments | 2.9% + $0.25 per transaction |
| Keyed-in Card Payments | 3.4% + $0.25 per transaction |
| Swiped/Dipped/Tapped Cards | 2.4% + $0.25 per transaction |
| ACH Bank Transfers | 1% per transaction (max $10) |
What Do These Fees Mean?
- Invoiced Payments: When you send an invoice to a client and they pay it online using a credit card, you’ll be charged 2.9% + $0.25 per transaction.
- Keyed-in Card Payments: If you manually enter a customer’s credit card details (e.g., over the phone), the fee is slightly higher at 3.4% + $0.25.
- Swiped/Dipped/Tapped Cards: If you use a card reader to process payments in person, the fee drops to 2.4% + $0.25.
- ACH Bank Transfers: For bank transfers, the fee is 1% of the transaction amount, capped at $10.
How Do QuickBooks Fees Compare to Other Processors?
To give you a better idea of how QuickBooks stacks up, here’s a quick comparison with two other popular payment processors:
| Processor | Invoiced Payments | Keyed-in Payments | Swiped Payments | ACH Transfers |
|---|---|---|---|---|
| QuickBooks | 2.9% + $0.25 | 3.4% + $0.25 | 2.4% + $0.25 | 1% (max $10) |
| PayPal | 2.9% + $0.49 | 3.5% + $0.49 | 2.7% + $0.49 | Free (up to 3 days) |
| Square | 2.9% + $0.30 | 3.5% + $0.15 | 2.6% + $0.10 | 1% (min $1) |
As you can see, QuickBooks’ fees are pretty competitive, especially for invoiced and swiped payments. However, if you’re processing a lot of ACH transfers, PayPal might be a better option since they don’t charge a fee for standard transfers.
Are There Any Additional Costs?
While the transaction fees are the main cost, there are a few other things to keep in mind:
- QuickBooks Online Subscription: To use QuickBooks Payments, you’ll need an active QuickBooks Online subscription. Plans start at $15/month, so factor this into your overall costs.
- Card Reader: If you want to accept in-person payments, you’ll need a card reader. QuickBooks offers a free magstripe reader, but you can upgrade to a contactless chip reader for $49.
- Chargeback Fees: If a customer disputes a charge, you may be charged a $15 fee per chargeback.
Tips to Minimize Credit Card Processing Fees
While you can’t avoid fees entirely, here are a few tips to keep your costs down:
- Encourage ACH Transfers: ACH fees are lower than credit card fees, so ask clients if they’re willing to pay via bank transfer.
- Use Invoicing: Invoiced payments have lower fees than keyed-in payments, so try to send invoices whenever possible.
- Negotiate Volume Discounts: If you process a high volume of transactions, contact QuickBooks to see if you qualify for discounted rates.
- Pass Fees to Customers: Some businesses add a small surcharge to cover processing fees. Just make sure to check local laws, as this isn’t allowed in all states.
FAQs: How Much Does QuickBooks Charge for Credit Card Payments
Q. Does QuickBooks charge a monthly fee for credit card processing?
No, QuickBooks doesn’t charge a monthly fee specifically for credit card processing. However, you’ll need an active QuickBooks Online subscription to use the service.
Q. Can I use QuickBooks Payments without QuickBooks Online?
No, QuickBooks Payments is only available to QuickBooks Online subscribers. If you’re using QuickBooks Desktop, you’ll need to switch to the online version to access this feature.
Q. How long does it take to receive funds from credit card payments?
Most payments are deposited into your bank account within 1 business day. ACH transfers may take 2-3 business days.
Q. Are there any hidden fees with QuickBooks Payments?
QuickBooks is transparent about its fees, but don’t forget to account for your QuickBooks Online subscription and any additional hardware costs, like a card reader.
Conclusion
QuickBooks is a powerful tool for managing your business finances, and its credit card processing fees are competitive with other popular payment processors. While the fees can add up, the convenience and integration with your accounting software often make it worth the cost.
Before committing, take the time to evaluate your business’s payment needs and compare QuickBooks with other options. And remember, there are ways to minimize fees, like encouraging ACH transfers or using invoiced payments.
Disclaimer: The information provided in this blog is for general informational purposes only and does not constitute financial or legal advice. Fees and features are subject to change, so always check QuickBooks’ official website for the most up-to-date information.
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